'There is a cover-up somewhere'

Dion accuses Harper's team of sitting on allegations for 7 months; Privy Council never forwarded key letter to PM

L'affaire Mulroney-Schreiber

STEVEN CHASE, With a report from Greg McArthur in Toronto - Liberal Leader Stéphane Dion accused the Harper government of sitting on allegations about Brian Mulroney's relationship with businessman Karlheinz Schreiber, questioning why it only acted last Friday to probe accusations that it was notified about seven months ago.
On Friday, Prime Minister Stephen Harper announced he would appoint a neutral adviser to review "new allegations" from a sworn affidavit Mr. Schreiber filed in the Ontario Superior Court of Justice, including a claim that while Mr. Mulroney was still in office, in 1993, the two struck a deal for the former prime minister to be paid $300,000 after he left public life.
But as The Globe and Mail reported Saturday, Mr. Schreiber sent Mr. Harper's office letters in March of 2007 containing the allegation that Mr. Mulroney discussed a financial agreement with the German-Canadian at the former prime minister's summer residence two days before his official resignation.
"There is a cover-up somewhere," Mr. Dion said. "The Prime Minister has a lot to explain. What did he know? When did he know it?"
The Prime Minister's Office said Mr. Harper never got the correspondence because it was received by the Privy Council Office - its bureaucratic arm - and was not forwarded to Mr. Harper.
"Even if it had been, it is unlikely Prime Minister Harper would have seen it," PMO spokeswoman Sandra Buckler said in an e-mail sent late Friday night. In an e-mail yesterday, she added that the Privy Council also never communicated the details of that correspondence to Mr. Harper verbally, saying the first he learned of these accusations was when they were filed in court. "The Prime Minister was clear - he acted when he learned about the new allegations contained in the sworn affidavit. He did not know about the new allegations previously," Ms. Buckler said.
Mr. Dion, Official Opposition Leader, said it strained credulity to accept that the Privy Council Office did not relay the allegations it received in the March, 2007, correspondence from Mr. Schreiber.
"[That] the Privy Council did not give such information that is so serious to the Prime Minister's Office ... is very difficult to believe," Mr. Dion told CTV's Question Period. "We need to know exactly what happened. We are speaking about something that in a democracy should not happen - the possibility of a former prime minister receiving cash money from obscure services given by a business person who is in trouble with the justice system."
Yesterday, Mr. Schreiber also questioned what happened.
"How could it be your [Harper's] people wouldn't show it to you when you have the political dynamite like this?" Mr. Schreiber said in an interview from the Toronto West Detention Centre, where he is awaiting a hearing on a bid by Germany to extradite him over charges of fraud, bribery and tax evasion. "The question is ... Did Harper see it or was it hidden from him?"
Asked to explain the decision not to relay Mr. Schreiber's March 29 correspondence to the PMO, the Privy Council Office said officials decided it did not require a reply "as the bulk of this ... contained letters to Mr. Mulroney and the subject matter was part of private lawsuit which was before the courts and did not involve the federal government."
An announcement is expected shortly on the adviser who will guide the probe for Mr. Harper.
Mr. Mulroney, who has said he will co-operate fully with the review, is scheduled to make a public appearance in Toronto tomorrow when he serves as the keynote speaker at a dinner for Nova Scotia's St. Francis Xavier University.
One organizer said Mr. Mulroney is still on track to speak at the event.
Mr. Harper's decision to probe Mr. Schreiber's allegations is an attempt to distance his government from Mr. Mulroney but it also risks tearing apart the Conservative Party that the former prime minister helped rebuild only four years ago.
One of the questions for Mr. Harper's review is whether these unproved allegations affect a $2.1-million settlement and apology Mr. Mulroney won from the Chrétien government in 1997 after it closed probes into allegations he received illegal commissions on the sale of Airbus jets to Canada.
The Privy Council Office is the bureaucratic arm of the Prime Minister's Office and is staffed by civil servants.
An area of the PCO called Executive Correspondence Services handles incoming correspondence addressed to the prime minister.
The PCO says the subject matter of correspondence determines how it's handled.
It forwards any mail that is political in nature - such as that related to the Conservative Party of Canada - to the PMO. Mail from prominent individuals or organizations, such as a head of state of another country, or the premier of a Canadian province, is sent to the Office of the Clerk of the Privy Council, the top boss in this bureaucracy. Kevin Lynch is the current Clerk.
ECS employs 35 people.
In 2005-2006, ECS processed more than a million incoming items of postal mail and more than one million e-mails.
Steven Chase

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